Raymond James has updated its outlook on Huntington Bancshares, raising the price target to $21.00 from a previous $20.00 while reaffirming a Strong Buy recommendation. This new target implies an upside potential relative to the bank's current trading price of $17.64, reflecting optimism despite recent market fluctuations.
Following the bank's release of its fourth-quarter 2025 financial results, the stock experienced a 6.0% decrease, in contrast to a modest 0.1% gain in the BKX index. Raymond James characterized the earnings release as "noisy," attributing this partly to the complications of consecutive acquisitions and ambiguities in the company’s guidance toward 2026.
Notwithstanding the share price softness, the analyst remains constructive on Huntington Bancshares based on its favorable valuation metrics. The price-to-earnings ratio stands at 13.13, suggesting the stock is trading below its peers, and the firm anticipates this discount will lessen over time. Supporting data from InvestingPro confirms that the stock is undervalued when measured against its Fair Value and also highlights a low price/earnings to growth (PEG) ratio of 0.36, underlining the stock's potential attractiveness.
Several strengths underpin Raymond James' positive stance on the stock. Huntington Bancshares is recognized for emphasizing relationship banking, a factor that contributes to its resilient and desirable core deposit base. The bank has demonstrated strong organic growth prospects, with revenue increasing by 12.14% over the trailing twelve months. Additionally, the company is noted for superior profitability metrics, disciplined underwriting standards, and a well-regarded management team.
Huntington’s commitment to shareholders is also evident, having paid dividends for 55 consecutive years with a current yield of 3.51%, as detailed by InvestingPro. This track record of consistent dividend payments highlights the company's financial stability and shareholder value focus.
Regarding the recent earnings report details, Huntington Bancshares posted adjusted earnings per share of $0.37, outperforming the consensus estimate of $0.33. Conversely, revenue recorded at $2.18 billion fell just short of the anticipated $2.2 billion, a shortfall noted by market participants. The mixed results—with a positive EPS surprise but a slight revenue miss—likely contributed to the stock's initial decline in pre-market trading following the announcement.
Investors and analysts will continue monitoring future quarterly results closely to evaluate Huntington Bancshares’ financial trajectory and execution of its strategic initiatives amid industry and economic pressures.